Press Release Details

--Better than Expected Quarter Driven by Strength in Wholesale
Business--

--Net Sales for the Quarter and Full-Year Fiscal 2018 Increase by
18.5% and 17.6%, Respectively--

--Provides Fiscal 2019 Guidance--

NEW YORK--(BUSINESS WIRE)--
G-III Apparel Group, Ltd. (NasdaqGS:GIII) today announced operating
results for the fourth quarter and full fiscal 2018 year ended January
31, 2018 and provided financial guidance for the first quarter and full
fiscal 2019 year.

Net sales for the fiscal year ended January 31, 2018 increased 17.6% to
$2.81 billion from $2.39 billion in the prior year. This includes net
sales of approximately $258 million related to operating our DKNY and
Donna Karan business ("DKI") in fiscal year 2018 compared to $28 million
in net sales from the two months of the prior year that the Company
owned this business.

The Company reported GAAP net income for the fiscal year ended January
31, 2018 of $62.1 million, or $1.25 per diluted share, compared to $51.9
million, or $1.10 per diluted share, in the prior year.

Non-GAAP net income per diluted share was $1.60 for the full fiscal 2018
year compared to $1.42 in the prior fiscal year. Non-GAAP net income per
diluted share excludes (i) professional fees related to the acquisition
of DKI of $736,000 in fiscal 2018 and $7.8 million in fiscal 2017, (ii)
non-cash imputed interest expense related to the note issued to seller
as part of the consideration for the acquisition of DKI of $5.7 million
in fiscal 2018 and $1.0 million in fiscal 2017, (iii) transitional
expenses related to the acquisition of DKI of $1.3 million in fiscal
2018 and $3.9 million in fiscal 2017, (iv) asset impairments primarily
related to leasehold improvements and furniture and fixtures at certain
of our retail stores of $7.9 million in fiscal 2018 and $10.5 million in
fiscal 2017 and (v) income tax charges of $7.5 million related to the
one-time effect of the enactment of the Tax Cuts and Jobs Act in fiscal
2018. These charges primarily relate to reduction of deferred tax assets
and taxes due on foreign earnings. The aggregate effect of these
exclusions was equal to $0.35 per diluted share in fiscal 2018 and $0.32
per diluted share in fiscal 2017.

For the fourth quarter ended January 31, 2018, net sales increased by
18.5% to $715 million from $603 million in the fourth quarter last year.
This includes net sales of approximately $85 million related to
operating our DKI business in the quarter compared to approximately $28
million in sales from the two months of the prior year that the Company
owned this business. The remainder of the year-over-year increase in net
sales in the fourth quarter reflects strength in the Company's wholesale
business, including new product launches. These increases were partially
offset by declines in net sales of the Company's legacy retail
businesses.

The Company reported a fourth quarter GAAP net loss of $542,000, or
$(0.01) per share, compared to a net loss of $20.1 million, or $(0.42)
per share, in the fourth quarter last year.

Non-GAAP net income per diluted share was $0.26 for the fourth quarter
2018 compared to a net loss of $(0.16) per share in the same period
prior year. Non-GAAP net income per diluted share excludes (i)
professional fees related to the acquisition of DKI of $230,000 in
fourth quarter 2018 and $5.2 million in fourth quarter 2017, (ii)
non-cash imputed interest expense related to the note issued to seller
as part of the consideration for the acquisition of DKI of $1.4 million
in fourth quarter 2018 and $1.0 million in fourth quarter 2017, (iii)
transitional expenses related to the acquisition of DKI of $56,000 in
fourth quarter 2018 and $3.9 million in fourth quarter 2017, (iv) asset
impairments primarily related to leasehold improvements and furniture
and fixtures at certain of our retail stores of $7.9 million in fourth
quarter 2018 and $10.5 million in fourth quarter 2017 and (v) income tax
charges of $7.5 million related to the one-time effect of the enactment
of the Tax Cuts and Jobs Act in fourth quarter 2018. These income tax
charges primarily relate to reduction of deferred tax assets and taxes
due on foreign earnings. The aggregate effect of these exclusions was
equal to $0.27 per diluted share in fourth quarter 2018 and $0.26 per
diluted share in fourth quarter 2017.

Morris Goldfarb, G-III's Chairman and Chief Executive Officer, said, "We
are pleased to have finished with better results than last year,
particularly as a result of our power brands: Calvin Klein, Tommy
Hilfiger, DKNY, Donna Karan and Karl Lagerfeld Paris. The strength of
these businesses is enabling us to grow profitably despite the pressures
of a persistently challenging environment."

Mr. Goldfarb concluded, "We are focused on improving the results of our
specialty retail operations. In that regard, we continue to implement
our strategy to improve productivity and streamline operations. We
believe that significant growth in our wholesale businesses should
continue to propel us to higher sales and profits over the next several
years."

Outlook

G-III Apparel Group today issued guidance for the fiscal year ending
January 31, 2019. Both GAAP and non-GAAP guidance for fiscal 2019
includes the impact of the following items: (i) exclusion of sales
related to Bon-Ton Stores, Inc. ("Bon-Ton"), who recently filed for
bankruptcy, which were anticipated to be approximately $100 million
based on sales to Bon-Ton in fiscal 2018; this has an estimated
unfavorable impact on fiscal 2019 net income per diluted share of
approximately $0.30; (ii) the impact of the new accounting standards
related to revenue recognition which require expenditures for
co-operative advertising to be reclassified from selling, general and
administrative expenses to a reduction in net sales, resulting in a
decrease in net sales growth and gross margin percentage of
approximately 1%, with an offsetting reduction in selling, general and
administrative expenses; and (iii) an anticipated effective income tax
rate of 27%.

For fiscal 2019, the Company is forecasting net sales of approximately
$2.94 billion and net income between $97 million and $102 million, or
between $1.90 and $2.00 per diluted share.

The Company is anticipating non-GAAP net income for fiscal year 2019
between $101 million and $106 million, or between $1.98 and $2.08 per
diluted share. Non-GAAP guidance excludes non-cash imputed interest
expense of approximately $5.7 million, or $0.08 per diluted share,
related to the note issued to the seller as part of the consideration
for the DKI acquisition.

The Company is projecting full-year adjusted EBITDA for fiscal 2019
between $218 million and $227 million compared to adjusted EBITDA of
$201.3 million in fiscal 2018.

For the first fiscal quarter ending April 30, 2018, the Company is
forecasting net sales of approximately $570 million and a net loss
between $2.0 million and $7.0 million, or $(0.04) to $(0.14) per share.
This forecast compares to net sales of $529 million and a net loss of
$10.4 million, or $(0.21) per share, reported in the first quarter of
fiscal 2018. Non-GAAP guidance excludes non-cash imputed interest
expense of approximately $1.4 million, or $0.02 per share, related to
the note issued to the seller as part of the consideration for the DKI
acquisition. On an adjusted basis, excluding non-cash imputed interest,
the Company is forecasting a non-GAAP net loss between $(0.02) and
$(0.12) per share. This compares to a net loss of $(0.18) in first
quarter of fiscal year 2018, which excluded professional fees and
transitional expenses of $1.1 million related to the acquisition of DKI
and non-cash imputed interest expense of $1.4 million, equal to $0.03
per share.

Non-GAAP Financial Measures

Reconciliations of GAAP net income or loss per share to non-GAAP net
income or loss per share and of GAAP net income to adjusted EBITDA are
presented in tables accompanying the condensed financial statements
included in this release and provide useful information to evaluate the
Company's operational performance. Non-GAAP net income or loss per share
and adjusted EBITDA should be evaluated in light of the Company's
financial statements prepared in accordance with GAAP.

Statements concerning G-III's business outlook or future economic
performance, anticipated revenues, expenses or other financial items;
product introductions and plans and objectives related thereto; and
statements concerning assumptions made or expectations as to any future
events, conditions, performance or other matters are "forward-looking
statements" as that term is defined under the Federal Securities laws.
Forward-looking statements are subject to risks, uncertainties and
factors which include, but are not limited to, reliance on licensed
product, reliance on foreign manufacturers, risks of doing business
abroad, the current economic and credit environment, the nature of the
apparel industry, including changing customer demand and tastes,
customer concentration, seasonality, risks of operating a retail
business, customer acceptance of new products, the impact of competitive
products and pricing, dependence on existing management, possible
disruption from acquisitions, risks relating to G-III's operations of
the Donna Karan International Inc. business and general economic
conditions, as well as other risks detailed in G-III's filings with the
Securities and Exchange Commission. G-III assumes no obligation to
update the information in this release.

G-III APPAREL GROUP, LTD. AND SUBSIDIARIES

(NASDAQ:GIII)

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

(Unaudited)

Three Months Ended

Twelve Months Ended

1/31/2018

1/31/2017

1/31/2018

1/31/2017

Net sales

$

714,897

$

603,289

$

2,806,938

$

2,386,435

Cost of sales

455,604

405,192

1,752,033

1,545,574

Gross profit

259,293

198,097

1,054,905

840,861

Selling, general and administrative expenses

219,246

199,890

855,247

704,436

Depreciation and amortization

10,304

9,583

37,783

32,481

Asset impairments

7,884

10,480

7,884

10,480

Operating profit (loss)

21,859

(21,856)

153,991

93,464

Other income (expense)

86

793

(454)

(27)

Interest and financing charges, net

(10,016)

(11,676)

(43,488)

(15,675)

Income (loss) before taxes

11,929

(32,739)

110,049

77,762

Income tax expense (benefit)

12,471

(12,634)

47,925

25,824

Net Income (loss)

$

(542)

$

(20,105)

$

62,124

$

51,938

Net income (loss) per common share:

Basic

$

(0.01)

$

(0.42)

$

1.27

$

1.12

Diluted

$

(0.01)

$

(0.42)

$

1.25

$

1.10

Weighted average shares outstanding:

Basic

49,091

47,789

48,820

46,308

Diluted

49,091

47,789

49,750

47,394

Selected Balance Sheet Data (in thousands):

At January 31,

2018

2017

Cash

$

45,776

$

79,957

Working Capital

612,434

567,519

Inventory

553,323

483,269

Total Assets

1,915,126

1,851,944

Long-Term Debt

391,044

461,756

Total Stockholders' Equity

1,120,688

1,021,242

G-III APPAREL GROUP, LTD. AND SUBSIDIARIES

RECONCILIATION OF GAAP NET INCOME (LOSS) PER SHARE TO NON-GAAP
NET INCOME (LOSS) PER SHARE

(Unaudited)

Three Months Ended

Twelve Months Ended

January 31,

January 31,

2018

2017

2018

2017

GAAP diluted net income (loss) per common share

$

(0.01

)

$

(0.42

)

$

1.25

$

1.10

Excluded from Non-GAAP:

Professional fees associated with the DKI acquisition

—

0.10

0.01

0.16

Non-cash imputed interest

0.03

0.02

0.12

0.02

Acquisition-related transition expense

—

0.08

0.03

0.08

Asset impairment charges

0.16

0.22

0.16

0.22

Tax Cuts and Jobs Act enactment

0.15

—

0.15

—

Income tax benefit impact of non-GAAP adjustments

(0.07

)

(0.16

)

(0.12

)

(0.16

)

Non-GAAP diluted net income (loss) per common share

$

0.26

$

(0.16

)

$

1.60

$

1.42

Non-GAAP diluted net income (loss) per common share is a "non-GAAP
financial measure" that excludes (i) professional fees, non-cash imputed
interest expense and DKI related transitional expenses, which are
comprised primarily of severance expenses, in connection with the
acquisition of DKI, (ii) asset impairments primarily related to
leasehold improvements and furniture and fixtures at certain of our
retail stores and (iii) income tax charges related to the one-time
effect of the enactment of the Tax Cut and Jobs Act. These income tax
charges primarily relate to reduction of deferred tax assets and taxes
due on foreign earnings. Income tax impacts of non-GAAP adjustments are
calculated using the effective tax rates for the respective periods,
exclusive of the one-time charges. Management believes that this
non-GAAP financial measure provides meaningful supplemental information
regarding our performance by excluding items that are not indicative of
our core business operating results. Management uses this non-GAAP
financial measure to assess our performance on a comparative basis and
believes that it is also useful to investors to enable them to assess
our performance on a comparative basis across historical periods and
facilitate comparisons of our operating results to those of our
competitors. The presentation of this financial information is not
intended to be considered in isolation or as a substitute for, or
superior to, the financial information prepared and presented in
accordance with GAAP.

G-III APPAREL GROUP, LTD. AND SUBSIDIARIES

RECONCILIATION OF FORECASTED AND ACTUAL NET INCOME TO
FORECASTED AND ACTUAL ADJUSTED EBITDA

(In thousands)

(Unaudited)

Forecasted

Twelve Months Ending

January 31, 2019

Actual

Twelve Months Ended

January 31, 2018

Actual

Twelve Months Ended

January 31, 2017

Net income

$97,000 - $102,000

$ 62,124

$ 51,938

Professional fees associated with the DKI acquisition

—

736

7,789

Acquisition-related transition expenses

—

1,314

3,910

Asset impairment charges

—

7,884

10,480

Depreciation and amortization

38,000

37,783

32,481

Interest and financing charges, net

49,000

43,488

15,675

Income tax expense

34,000 - 38,000

47,925

25,824

Adjusted EBITDA, as defined

$218,000 - $227,000

$201,254

$ 148,097

Adjusted EBITDA is a "non-GAAP financial measure" which represents
earnings before depreciation and amortization, interest and financing
charges, net, and income tax expense and excludes professional fees and
DKI related transitional expenses, which are comprised primarily of
severance expenses, and asset impairments primarily related to leasehold
improvements and furniture and fixtures at certain of our retail stores.
Adjusted EBITDA is being presented as a supplemental disclosure because
management believes that it is a common measure of operating performance
in the apparel industry. Adjusted EBITDA should not be construed as an
alternative to net income, as an indicator of the Company's operating
performance, or as an alternative to cash flows from operating
activities as a measure of the Company's liquidity, as determined in
accordance with GAAP.

G-III APPAREL GROUP, LTD. AND SUBSIDIARIES

RECONCILIATION OF FORECASTED AND ACTUAL NET INCOME

TO NON-GAAP NET INCOME

(In thousands)

(Unaudited)

Forecasted

Twelve Months Ending

January 31, 2019

Actual

Twelve Months Ended

January 31, 2018

Actual

Twelve Months Ended

January 31, 2017

Net income

$97,000 - $102,000

$ 62,124

$51,938

Professional fees associated with the DKI acquisition

—

736

7,789

Non-cash imputed interest

5,700

5,714

952

Acquisition related transition expenses

—

1,314

3,910

Asset impairment charges

—

7,884

10,480

Tax Cuts and Jobs Act enactment

—

7,477

—

Income tax benefit impact of non-GAAP adjustments

(1,700)

(5,871)

(7,682)

Non-GAAP Net income, as defined

$101,000 - $106,000

$ 79,378

$67,387

Non-GAAP Net income is a "non-GAAP financial measure" that excludes (i)
professional fees, non-cash imputed interest expense and DKI related
transitional expenses, which are comprised primarily of severance
expenses, in connection with the acquisition of DKI, (ii) asset
impairments primarily related to leasehold improvements and furniture
and fixtures at certain of our retail stores and (iii) income tax
charges related to the one-time effect of the enactment of the Tax Cut
and Jobs Act. These income tax charges primarily relate to reduction of
deferred tax assets and taxes due on foreign earnings. Income tax
impacts of non-GAAP adjustments are calculated using the effective tax
rates for the respective periods, exclusive of the one-time charges.
Management believes that this non-GAAP financial measure provides
meaningful supplemental information regarding our performance by
excluding items that are not indicative of our core business operating
results. Management uses this non-GAAP financial measure to assess our
performance on a comparative basis and believes that it is also useful
to investors to enable them to assess our performance on a comparative
basis across historical periods and facilitate comparisons of our
operating results to those of our competitors. The presentation of this
financial information is not intended to be considered in isolation or
as a substitute for, or superior to, the financial information prepared
and presented in accordance with GAAP.

G-III APPAREL GROUP, LTD. AND SUBSIDIARIES

RECONCILIATION OF FORECASTED AND ACTUAL NET INCOME (LOSS)

PER SHARE TO NON-GAAP NET INCOME (LOSS) PER SHARE

(Unaudited)

Three Months Ended

Twelve Months Ended

April 30,

January 31,

Forecast 2018

2017

Forecast 2019

2018

GAAP diluted net income (loss) per common share

$(0.14) - $(0.04)

$(0.21)

$1.90 - $2.00

$1.25

Excluded from Non-GAAP:

Professional fees associated with the DKI acquisition

—

—

—

0.01

Non-cash imputed interest

0.03

0.03

0.11

0.12

Acquisition-related transition expense

—

0.02

—

0.03

Asset impairment charges

—

—

—

0.16

Tax Cuts and Jobs Act enactment

—

—

—

0.15

Income tax benefit impact of non-GAAP adjustments

(0.01)

(0.02)

(0.03)

(0.12)

Non-GAAP diluted net income (loss) per common share

$(0.12) - $(0.02)

$(0.18)

$1.98 - $2.08

$ 1.60

Non-GAAP diluted net income (loss) per common share is a "non-GAAP"
financial measure" that excludes (i) professional fees, non-cash imputed
interest expense and DKI related transitional expenses, which are
comprised primarily of severance expenses, in connection with the
acquisition of DKI, (ii) asset impairments primarily related to
leasehold improvements and furniture and fixtures at certain of our
retail stores and (iii) income tax charges related to the one-time
effect of the enactment of the Tax Cut and Jobs Act. These income tax
charges primarily relate to reduction of deferred tax assets and taxes
due on foreign earnings. Income tax impacts of non-GAAP adjustments are
calculated using the effective tax rates for the respective periods,
exclusive of the one-time charges. Management believes that this
non-GAAP financial measure provides meaningful supplemental information
regarding our performance by excluding items that are not indicative of
our core business operating results. Management uses this non-GAAP
financial measure to assess our performance on a comparative basis and
believes that it is also useful to investors to enable them to assess
our performance on a comparative basis across historical periods and
facilitate comparisons of our operating results to those of our
competitors. The presentation of this financial information is not
intended to be considered in isolation or as a substitute for, or
superior to, the financial information prepared and presented in
accordance with GAAP.